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Biochemicals S2G Technology S2G Background Commercialization
Introduction to S2G
Commercial Biochemical Opportunity
October, 2015
Biochemicals – What They Are
Petrochemicals are made from oil & gas
• Multi-billion $ markets & high value
• 2% of a barrel of oil used for petrochemicals 40% of revenue (DOE)
Biochemicals are made from sustainable
feedstocks• Starting point to help wean the world off dependence on oil & gas
• Experiencing rapid growth: 9% CAGR through 2020 (Clariant)
• vs 3+% for overall chemical industry
• Strong pull from major users:
• Coke, Pepsi, Ford, P&G, etc.
Business Confidential 2
Biochemicals:
Better Investment than Biofuels
• Investments to date:
• India Glycol
• Liquid Light
• Avantium
Bio
Ethylene
Glycol
(EG)
• Investments to date:
• ADM
• Global Bio-chem
• DuPont – Tate & Lyle
Bio
Propylene
Glycol
(PG)
• Investments to date:
• BioAmber – succinic
acid
• Gevo – butanol
• Genomatica –
butanediol
• OPX Bio – lactic acid
Other
bio-
chemicals
Business Confidential 3
Higher value vs biofuels;
No government subsidy required
Growing interest in biochemicals
S2G’s Technology: Bio-glycols
Ethylene & Propylene Glycol: a $30 billion market
S2G’s Founder: a pioneer in the bio-glycol space
• Experience back to 1990’s
• 1st generation technology commercialized in 2000’s in China
S2G: advancing the technology since 2009
• 2nd generation non-food feedstocks
• Proven, robust, highly-efficient, scalable suitable for commercial chemical production
• Novel co-production of high-value products best margin and returns
Business Confidential 4
Recent Novel Development:
S2G’s “Haystack” Technology
Business Confidential 5
Co-production of F-100 & Glycols from Cellulosic Sugars
• F-100: High value product with superior properties
• Use limited by current high cost to produce
S2G’s partner: Fortune 100 company & leading F-100 user
• F-100 is strategic: opportunity for sales growth and cost savings
$10 MM joint development program with S2G:
• Co-production of F-100 with glycols significant cost savings opportunity
Game-changing for both bio-glycols and F-100
S2G Technology Features
Catalytic
conversion
process
Continuous
Scalable
Durable
Rapid
High product yield
Feedstock
conditioning
technology
Feedstock flexibility
2nd Generation
Product mix
Product
separation &
purification
technology
High purity/ high
value products
Drop-in
replacement
ONLY viable
process for cost-
effective bio-EG
Coproduction of
F-100
Strategic interest
New markets
Increased margin
6Business Confidential
S2G History2009
• Acquired
technology &
team of IPCI
(USA)
•1st Generation
•20 yrs experience
•Commercialized in
China
2009-11
• Lab work
•2nd generation
sugars & glycerol
•Improved, water
tolerant catalyst
•Sugar conditioning
2012-13
• Piloting /
Engineering
•Pulp liquors, crude
beet sugars,
cellulosic sugars
•Process modelling /
Pre-FEED
engineering
2014-15
• Haystack
Program
•With Fortune 100
partner
•Co-production F-
100
•Tech development
& piloting
•Product
separations
2016
• BlueBelle
•Full-scale
commercial
demonstration
•Production
Business Confidential 7
GBT Plant: 200,000 TPY
Capabilities:
Technology Development & Engineering
$6 MM Pilot
Plant
Start-up Nov
2012
24/7
operation
Lab &
Analytical
Vancouver &
Seattle
Process
Development
& Modelling
ASPEN
Front-End
Engineering
Design (FEED)
8Business Confidential
Strategic Partners
“Haystack” A Fortune 100 consumer products company
Strategic interest in “F-100” product
$10 MM invested to date to co-develop Haystack technology with S2G
Sacré-Davey Engineering
Mid-size engineering firm with industrial and cleantech expertise
Investor and partner
“BlueBelle” Experienced US chemical producer
Host site and operating partner for 1st commercial project
Investor and partner
Business Confidential 9
S2G Team
Management & Key Personnel
10
Name Position Background
Mark Kirby Pres/CEO Praxair, Questair, Ballard
Terry Brix Founder/CTO Battelle, IPCI, Brix-Berg
Himanshu Kamboj, CA CFO DMCL, M&P
Jeff Plato Director, BD & Corp Dev Paradigm, Hydrogenics, GE, HP
Kent Smith, PEng Director, Projects Pacific Coast Terminals, Vancouver Wharves
Norm Barmeier, PEng Project Manager Apotex, AECOM, KGS Group
Claudio Arato, BSc, PEng Process Manager Lignol, Millar Western, Sonora
Prof Bill McKean Principal Scientist Battelle, Weyerhaeuser, Univ. of Washington
Dr Lloyd Allen Senior Scientist Dow, Innovatek, Westinghouse, PNNL
Quak Foo Lee, MEng Plant Mgr & R&D Eng City Farm Biofuel, UBC
Dr Josh Davies Senior Scientist U of W
Bryan Gene, BASc Process Eng UBC
Business Confidential
Commercialization
Q1 2016: Commercial-scale demonstration using existing equipment at a US chemical plant
End of 2016: Start of commercial PG production using refurbished equipment at above site
2017: Demonstration of Haystack process (EG, PG & F-100) at above site
2018: Start of commercial Haystack production
2018 Rollout to other US and international locations
Business Confidential 11
S2G BioChemicals Inc.
• Privately held
• Major shareholders:– IPCI
– Sacre-Davey Engineering
– Angel Investors &
– Management
• Support from:– Sustainable Development Technologies
Canada
– National Research Council (IRAP)
– BC Innovative Clean Energy
• Visit our pilot plant in Vancouver, BC– At the National Research Council Facility
on the campus of the University of BC
• Contact us…
12
S2G BioChemicals Inc.
4250 Wesbrook Mall,
Vancouver, BC V5T 1W6
CANADA
1-604-259-9820
www.s2gbiochem.com
Business Confidential
LAB & PILOT CAPABILITIES
Supplemental Information
Business Confidential 13
Pilot Plant
Business Confidential 14
Pilot Conditioning Equipment
Business Confidential 15
Feedstock Conditioning
Business Confidential 16
Cellulosic Sugars
Crude Glycerol
Pilot Hydrotreating
Business Confidential 17
Pilot Plant Status: Operating Since
Nov. 14, 2012
10/14/2015 18
Laboratory Hydrotreating Units
Business Confidential 19
Catalyst &
Catalyst Durability
24-7 Operation
Laboratory Distillation
Business Confidential 20
Analytical
Business Confidential 21
S2G BLUEBELLE PROJECT
Opportunity
Business Confidential 22
Project Overview
Business Confidential 23
Install commercial glycol production from glycerol and
cellulosic sugars at a location in Memphis TN.
Full commercial-scale demonstration with existing equipment in Q1 2016
Install new equipment, upgrade existing equipment and start commercial production in 2016
Install additional equipment to increase production and capabilities in 2017
Features & Benefits of BlueBelle
Project
Features Benefits
Commercial-scale demonstration
with existing equipment at site
De-risks process performance
Experienced chemical industry
operating partner
De-risks build, commissioning,
operation
Existing equipment vended into
project
Reduces capital by 50%
Glut of biodiesel glycerol and
producers looking for a “hedge”
Cost-effective & secure raw
material supply
Cellulosic sugar to PG & EG
capabilities (platform for Haystack
demonstration)
Strategic partner willing to invest
and ensure completion
Business Confidential 24
Value - Efficiency
0
200
400
600
800
1000
1200
1400
1600
1800
2000
RefinedGlycerol
Royalty (35%of Value)
Adjusted forYield
VariableProcessing
Costs
FixedProcessing
Costs
S2G Royalty(3% ofValue)
PropyleneGlycolPricing
Value Creation
Value
S2G Royalty
Fixed Processing Cost
Variable Processing Cost
Adjusted for Yield
Feedstock Cost
Business Confidential 25
$/M
T
Opportunity for Glycerol Supplier
Profitable application for glycerol
Hedge for refined glycerol market
Participate in large, growing glycol market
Potential baseload for new glycerol refinery
Business Confidential 26
Glycerol Requirement
Amount2017:
10,000 MT
2018 and ongoing:
20,000 MT/yr
QualityTechnical
grade
Risk Management
Security of supply
Competitive pricing
Business Confidential 27
